What does the government imply by “Zero Registration Fees”?
The announcement of ‘Zero Fees for Registration of Companies having authorized capital up to INR 10L’ was a ‘Yay!’ moment for many. Entrepreneurs, swayed by this amendment, little did they know the complete story, were under an impression that Ministry of Corporate Affairs had uprooted the registration expense altogether. With an additional reason to enjoy, entrepreneurs celebrated the implementation of the new rules on 26th of January, 2018. In this blog, we at Wazzeer intend to turn all the stones to help you understand the true meaning of “No Company Registration Fee”
Reviewing the proposed changes:
The main objective behind the proposed amendments to the Companies Act, 2013 was to open a door for entrepreneurs to register their businesses with ease and at a quicker rate. Two major processes or changes that were brought in place were:
- Discard the lengthy time taking Name Approval process (e-form INC -1) and get an electronic platform to get this done (RUN facility – Reserve Unique Name)
- Reduce the expenses incurred by entrepreneurs to register business – Introduced ‘Zero Fees for incorporation fees for Companies having Authorized Capital up to INR 10L)
Uncovering the actuals:
- The Ministry has amended the fees payable to the Registrar to incorporate the companies.
- The Companies claimed the benefit of Zero Fees for incorporation shall maintain the status of small companies till one year. Therefore, the companies could not increase its Authorized Capital above INR 10 lakh within the span of 1 year from its incorporation.
- The fees payable to States were not reduced or eliminated i.e. the Stamp Duty on MoA and AoA of the companies would stay intact.
- Charges that remain in place are:
- Fee for Company Name Application
- Company Registration Fee (Based on Authorised Capital / Number of Members of the Company on Memorandum – Form No.INC-32-SPICe),
- Filing Fee for documents such as Memorandum of Association (Form No.INC-33-SPICe) and Articles of Association (Form No.INC-34-SPICe),
- Stamp duty payable to the state government on registration of Memorandum and Articles of Association based on authorized capital, declarations, affidavits etc.
We at Wazzeer have helped businesses in various sectors start smoothly without hassle. We would be very excited to help you kick your business and thereafter too. So let’s connect -> “Get Started!”